Charlotte’s Web Holdings, a Colorado-based, hemp-derived CBD leader, said it signed a five-year purchase agreement option to acquire a marijuana company for $8 million. The marijuana business was started by Charlotte Web’s founding company, Stanley Brothers USA Holdings. The deal is structured so that Boulder-based Charlotte’s Web can take over the marijuana business once the drug is legalized nationally in the United States – or perhaps earlier, depending on the policies of the stock exchange where the company’s securities are listed. At that time, a total price for the transaction will be determined based on a “weighted application of 3.5 times revenue and 13.5 times EBITDA multiples … or a base amount and earn-out, in certain circumstances,” according to a news release. Charlotte’s Web is a high-CBD drug that has proved successful in treating seizures. Stanley Brothers USA makes cannabis products whose THC levels are too high to qualify as legal hemp but are lower than many formulations in recreational marijuana markets.
Marijuana Business Daily, 03/04/2021 13:45:00